MIRA INFORM REPORT

Report Date :

2^nd March, 2007

IDENTIFICATION DETAILS

Name :	HANOI TEXTILE & GARMENT CORPORATION
Formerly Known as:	HANOI TEXTILE COMPANY
Registered Office :	No. 1 Mai Dong Str, Hoang Mai Dist, Hanoi City
Country :	Viet Nam
Financials (as on) :	31.12.2005
Date of Incorporation :	21.11.1984
Com. Reg. No.:	110006
Legal Form :	State Owned Enterprise
Line of Business :	Manufacturing, trading and import - export of textile-garment products, material resources, sub-materials, equipments, chemical, dyestuff, equipment and machinery, part and spare part using in textile and garment industry.

RATING & COMMENTS

MIRA’s Rating :

A

RATING		STATUS	PROPOSED CREDIT LINE
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large

Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear

SUBJECT IDENTIFICATION & LEGAL FORM

English Name	HANOI TEXTILE & GARMENT CORPORATION
Vietnamese Name	CONG TY DET MAY HANOI
Trade Name	HANOSIMEX
Type of Business	State Owned Enterprise
Business registration	No. 110006
Date of Issuance	July 11^th, 1995
Place of Issuance	Hanoi Department of Planning & Investment
Registered Capital	155,188,892,395 VND
Tax code	0100100826 -1
Total Employees	5,500 employees
Qualification	Qualified

ADDRESSES

1. Head Office:
Address	No. 1 Mai Dong Str, Hoang Mai Dist, Hanoi City
Country	Vietnam
Tel	(84-4) 8624619/ 8621024
Fax	(84-4) 8622334
Email	hanosimex@hn.vnn.vn
Website	http://www.hanosimex.com.vn
Note: The Subject was formally established on November 21^st 1984 with the first name of Hanoi Spinning Mill. On April 30^th, 1991, it was changed into Hanoi Spinning - Knitting Unite Enterprise (Decision No. 138-CNN-TCLL). On June 19^th, 1995, Its name was changed to Hanoi Textile Company (Decision No.840-TCLD issued by Ministry of Light Industry). On 28^th February 2000, the Subject changed to this current name: Hanoi Textile – Garment Company under the Decision No.103-HĐQT. According to the Decision No.117/2004/QĐ-TTg dated on 29^th, June 2004 and Decision No.177/2004/QĐ-BCN dated on 30^th, December 2004, Hanoi Textile & Garment Company has official operated under the Holding Company model (mother & subsidiary company model) from 22^nd January 2005. All of the legal rights and obligations, estates of the Hanoi Textile - Garment company have been transferred to new company model.
Member Companies:
Haiphong Trading Joint Stock Company Hanoi Fashion Garment Joint Stock Company Pho Noi Textile Joint Stock Company Hanoi Garment Joint Stock Company
Joint Venture Companies
Dong My Garment Joint Stock Company Hoang Thi Loan Textile - Garment Joint Stock Company Ha Dong Garment Joint Stock Company Mechanical Automatization Service Company Textile Joint Stock Company Hue Garment Joint Stock Company Ha Dong Vinatex Joint Stock Company

DIRECTORS

1. NAME	Mr. NGUYEN KHANH SON
Position	General Director
Year of birth	1960
Resident	Hanoi City, Vietnam
Nationality	Vietnamese
2. NAME	Mr. HO LE HUNG
Position	Deputy Director
Resident	Hanoi city, Vietnam
Nationality	Vietnamese
3. NAME	Mr. CHU TRAN TRUONG
Position	Deputy Director
Resident	Hanoi city, Vietnam
Nationality	Vietnamese
4. NAME	Mrs. LE THI HUONG MAI
Position	Deputy Director
Resident	Hanoi city, Vietnam
Nationality	Vietnamese
5. NAME	Mrs. LE MINH THU
Position	Deputy Director
Resident	Hanoi city, Vietnam
Nationality	Vietnamese
6. NAME	Mrs. NGUYEN THU HA
Position	Deputy Director
Resident	Hanoi city, Vietnam
Nationality	Vietnamese
7. NAME	Mrs. NGUYEN THI THANH BINH
Position	Deputy Director
Resident	Hanoi city, Vietnam
Nationality	Vietnamese
8. NAME	Ms. CHU TRAN TRUONG
Position	Deputy Director
Resident	Hanoi city, Vietnam
Nationality	Vietnamese

BUSINESS NATURE AND ACTIVITIES

The Subject is specializing in the following activities:

Manufacturing, trading and import - export of textile-garment products, material resources, sub-materials, equipments, part and spare part using in textile and garment industry.

Trading, import – export of cotton, fiber, sub-materials, chemical, dyestuff, equipment and machinery using in textile and garment industry.

The subject registered in the following activities:

Trading in storage, plant and office for rent, investment and business into infrastructure.

Business in restaurant, hotel, supermarket, entertainment services.

Supplying technical and scientific services, repairing and maintaining machinery and equipment

Installing industrial equipment, refrigerating system.

Other activities under the legal regulations.

IMPORT & EXPORT ACTIVITIES

IMPORT: The subject mainly imports cotton, chemical substance, dyestuff, equipment, and spare parts for textile and garment industry from USA, Germany, Belgium, Japan, and China.

EXPORT: The subject exports its products to EU, USA, Japan, Korea, Turkey, Taiwan and so on.

BANKERS

1. INDUSTRIAL AND COMMERCIAL BANK OF VIETNAM – HAI BA TRUNG BRANCH
Address	285 Tran Khat Chan Str, Hai Ba Trung Dist, Hanoi City
Country	Vietnam
Tel	(84-4) 7918251
Fax	(84-4) 7918226
2. BANK FOR FOREIGN TRADE OF VIETNAM
Address	198 Tran Quang Khai St, Hoan Kiem Dist, Hanoi City
Country	Vietnam
Tel	(84-4) 8251322/ 8240976
Fax	(84-4) 8269067
3. BANK FOR INVESTMENT AND DEVELOPMENT OF VIETNAM
Address	A Tower, VINCOM Building, 191 Ba Trieu, Hai Ba Trung Dist, Hanoi City
Country	Vietnam
Tel	(84-4) 2200422 / 2200484
Fax	(84-4) 2200399
Besides, the subject also has banking relations with other banks including: Indovina bank, Vietnam bank for agricultural and rural development - Northern Hanoi branch, …

SHAREHOLDER

The Subject is a 100% State Owned Enterprise. Its parent company is as follows:
NAME	VIETNAM TEXTILE AND GARMENT GROUP (VINATEX GROUP)
Address	No. 25, Ba Trieu Str, Hoan Kiem Dist, Hanoi City
Country	Vietnam
Tel	(84-4) 826 5897
Fax	(84-4) 826 2269
Website	www.vinatex.com
Share	100%

PAYMENT HISTORY AND EXPERIENCES

Trade Morality	Fairly
Liquidity	Acceptable
Previous Payment Status	Normal
Current Payment Status	Prompt
Past Financial Situation	Normal
Current Financial Situation	Normal
Legal Action	No recorded
Bankruptcy	No recorded
Reputation	Fairly
Sales methods	Directly to clients and through its agents

FINANCIAL DATA

BALANCE SHEET

Unit: VND 1,000,000

Balance sheet date	31/12/05	31/12/04	31/12/03	31/12/02
Number of weeks	52	52	52	52
ASSETS
A. Working assets & short-term Investment	505,034	430,192	316,465	358,598
I. Cash and cash equivalents	12,900	28,795	21,363	10,128
II. Short-term investment	0	0	0	0
III. Receivables	233,368	163,849	135,759	141,940
1. Receivables from customers	201,299	141,360	129,772	102,996
2. Prepayment for providers	19,091	13,498	1,917	28,954
3. Value-added tax deducted	7,862	7,465	2,620	7,289
4. Internal receivables	0	0	0	0
5. Other receivables	7,908	3,277	3,168	3,413
6. Provision for bad receivables	-2,792	-1,751	-1,718	-712
IV. Inventory	258,257	236,652	158,803	202,361
1. Purchased goods in transit	0	0	0	0
2. Raw materials	0	80,866	73,244	78,521
3. Instrument, tools	0	4,706	3,309	3,236
4. Cost for production and business in process	0	53,277	32,983	35,815
5. End products	262,059	100,909	66,361	86,709
6. Goods	0	0	0	0
7. Goods on consignment	0	0	0	0
8. Provision for devaluation of stocks	-3,802	-3,106	-17,094	-1,920
V. Other current assets	509	896	540	4,169
1. Advances	0	794	540	832
2. Prepaid expenses	467	102	0	0
3. Pending expenses for transfer	0	0	0	0
4. Pending assets	0	0	0	0
5. Mortgage, collateral and short run collateral	42	0	0	3,337
VI. Administrative	0	0	0	0
1. Administrative expenses for previous year	0	0	0	0
2. Administrative expenses for current year	0	0	0	0
B. Fixed assets & Long term investment	319,274	248,137	292,346	325,534
I. Fixed assets	306,896	247,642	291,408	322,885
1. Tangible fixed assets	306,698	247,464	291,194	322,885
+ Original cost	785,330	714,122	706,739	693,043
+ Accumulated depreciation value	-478,632	-466,658	-415,545	-370,158
2. Financial leasing fixed assets	0	0	0	0
+ Original cost	0	0	0	0
+ Accumulated depreciation value	0	0	0	0
3. Intangible fixed assets	198	178	214	0
+ Original cost	302	239	239	0
+ Accumulated depreciation value	-104	-61	-25	0
II. Long term investment	12,290	0	0	0
1. Long-term securities investment	0	0	0	0
2. Joint-venture capital contribution	12,214	0	0	0
3. Other long-term investment	0	0	0	0
4. Provision for long-term investment devaluation	76	0	0	0
III. Capital construction in process	15	495	938	2,649
IV. Other	73	0	0	0
TOTAL ASSETS	824,308	678,329	608,811	684,132
LIABILITIES
A. Payable loans	664,201	512,429	451,020	522,946
I. Short term payables	502,410	376,332	248,500	306,425
1. Short-term borrowings	366,368	262,514	180,583	235,308
2. Due long-term liabilities	0	40,544	0	0
3. Payables to supplier	100,835	41,115	47,622	54,579
4. Prepayment of buyer	9,223	2,025	1,239	2,807
5. Taxes and accounts dutiable	1,706	3,033	349	2,937
6. Employee payments	13,316	20,467	16,096	7,969
7. Internal payables	60	0	0	0
8. Other payables	10,902	6,634	2,611	2,825
II. Long term loans	159,781	132,600	202,120	214,646
1. Long-term borrowings	159,781	132,600	202,120	214,646
2. Long-term payables	0	0	0	0
III. Other payables	2,010	3,497	400	1,875
1. Disbursement payable	2,010	3,497	400	1,875
2. Pending assets	0	0	0	0
3. Receipts long-term collateral and deposit	0	0	0	0
B. Owner’s Equity	160,107	165,900	157,791	161,186
I. Capital and Funds	155,928	161,668	157,125	161,087
1. Share capital	154,236	155,211	157,349	161,411
2. Differences from asset revaluation	0	0	0	0
3. Exchange rate differences	976	0	-278	-345
4. Development investment funds	0	5,369	33	0
5. Reserved funds	695	1,067	0	0
6. Retained profit	0	0	0	0
7. Construction capital sources	21	21	21	21
II. Other administrative and fund sources	4,179	4,232	666	99
1. Provident funds for unemployment	0	0	0	0
2. Reward and welfare funds	4,179	4,232	666	99
3. Management funds of higher level	0	0	0	0
4. Functional operation funds	0	0	0	0
5. Fund sources formed by fixed assets	0	0	0	0
TOTAL LIABILITY AND EQUITY	824,308	678,329	608,811	684,132

PROFIT & LOSE ACCOUNT (INCOME STATEMENT)

Description	FY 2005		FY 2004	FY 2003	FY 2002
Total revenue	1,353,638		973,949	868,727	668,320
Deductions Items	2,459		1,585	5,626	2,850
- Discount	0		0	0	0
- Devaluation	2,459		650	830	1,791
- Return of sold goods	0		935	4,796	1,059
- Turnover tax, Luxury tax & Export tax	0		0	0	0
1. Net revenue	1,351,179		972,364	863,101	665,470
2. Cost of goods sold	1,233,693		869,342	758,983	572,068
3. Gross Profit	117,486		103,022	104,118	93,402
4. Sales expenses	53,835		41,674	46,423	30,885
5. Enterprise administrative expenses	27,580		25,330	28,997	22,876
6. Net income from business activities	36,071		36,018	28,698	39,641
Income from financial activities	6,352		1,752	1,504	1,111
Expenditure from financial activities	35,955		25,132	28,263	38,942
7. Net income from financial operation	-29,603		-23,380	-26,759	-37,831
Irregular income	1,427		953	1,404	801
Irregular expenditure	97		1,029	104	297
8. Irregular Profit	1,330		-76	1,300	504
9. Total pre-tax profit	7,798		12,562	3,239	2,314
10. Income tax	2,183		3,518	1,162	740
11. After tax profit	5,615		9,044	2,077	1,574
Gross Profit / Total Revenue (%) GPM		8.68	10.58	11.99	13.98

FINANCIAL FACTORS

Description	FY 2005	FY 2004	FY 2003	FY 2002
Current Liquidity Ratio	1.01	1.14	1.27	1.17
Quick Liquidity Ratio	0.49	0.51	0.63	0.51
Inventory Circle	4.99	4.40	4.78	3.29
Average Receive Period	63.04	61.50	57.41	77.85
Utilizing Asset Performance	1.64	1.43	1.42	0.97
Liability / Total Asset (%)	80.58	75.54	74.08	76.44
Liability / Owner's Equity (%)	414.85	308.88	285.83	324.44
Income Before Tax / Total Asset (%) ROA	0.95	1.85	0.53	0.34
Income Before Tax / Owner's Equity (%) ROE	4.87	7.57	2.05	1.44
Income Before Tax / Total Revenue (%) NPM	0.58	1.29	0.37	0.35

INTERPRETATION ON THE SCORES

The subject is a big state owned enterprise belonging to Vietnam National Textile and Garment Group. It also is one of the biggest companies in textile and garment industry in Vietnam. The subject was officially established in the year 1995 after some years of operation.

The subject specializes in producing, exporting and trading in many garment and textile products such as: 100% cotton, 100% polyester, cotton/polyester, polyester/cotton yarn, knitted fabric, knitwear, denim fabric, cotton towel, cap…and supplying machinery and equipment to serve for textile and garment industry in Vietnam. Its production capacity is very big. Besides, the subject is focusing on improving its productivity and competitiveness.

The products of the subject are high quality products. “HANOSIMEX” is a famous trademark both in domestic and international markets. During its development, the subject has attained many achievements. The subject has gained many gold medals and certificates of honour for its high quality at national trade fairs.

The premises and facilities of the subject are good. Its management capability is fairly good. With 5,500 employees and total land area of 24 hectares, the subject is the leading company in Vietnamese light industrial branch.

The financial and solvency status in 2002, 2003, 2004 and 2005 was acceptable. The annual revenue and export turnover are increased in comparison with that of previous year. Its financial ability is fairly strong. Moreover, it has credit of banks in Vietnam including Vietnam Bank For Investment and Development. It has ability to meet its financial commitments. No caution needed for any normal business transactions.

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
NR		In view of the lack of information, we have no basis upon which to recommend credit dealings	No Rating

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions